I have never read a business plan or balance sheet
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Re: I have never read a business plan or balance sheet
#2I wonder why it was surprising for some to read this tweet. Startups will change their priorities daily. Business plans are against the idea of running a startup.
Re: I have never read a business plan or balance sheet
#3Seems related to Systems vs. Goals. [1]
Biz plans and Balance Sheets are more associated with a goal-oriented mindset.
PG's decision making obviously aligns more with a systems thinking. Founders are a major piece of a winning system to him, thus why he puts so much value in a 5-minute talk with them.
[1] https://medium.com/@flaviorump/systems-vs-goals-a67fcd937370
Re: I have never read a business plan or balance sheet
#4I wonder why it was surprising for some to read this tweet. Startups will change their priorities daily. Business plans are against the idea of running a startup.
Probably because many people who follow him on Twitter have no idea what running a startup is like, so they are imagining a completely different context. Business plans do make sense in other contexts.
Re: I have never read a business plan or balance sheet
#5I wonder why it was surprising for some to read this tweet. Startups will change their priorities daily. Business plans are against the idea of running a startup.
https://apply.ycombinator.com/ is basically a business plan, isn't? Is it distinct enough to not be framed as such?
Re: I have never read a business plan or balance sheet
#6I understand business plans, but balance sheets? It seems like you'd want to know the financial picture of a company. What else to you look at to, even at the most basic level, determine if the startup is going to be able to pay it's AWS bill and payroll that month?
Re: I have never read a business plan or balance sheet
#7I understand business plans, but balance sheets? It seems like you'd want to know the financial picture of a company. What else to you look at to, even at the most basic level, determine if the startup is going to be able to pay it's AWS bill and payroll that month?
perhaps the P&L? That's the bestest report (imo) of the business.
Re: I have never read a business plan or balance sheet
#8I wonder why it was surprising for some to read this tweet. Startups will change their priorities daily. Business plans are against the idea of running a startup.
https://apply.ycombinator.com/ is basically a business plan, isn't? Is it distinct enough to not be framed as such?
Yea I feel like the whole Twitter thread is just PG moving around goalposts on "What is a business plan" or "what is a balance sheet".
I mean his article on "The Equity Equation"[1] seems to be written by someone who has read a balance sheet.
Re: I have never read a business plan or balance sheet
#9I read them to see how people think. You can learn most of the same by talking to them. He didn’t say he doesn’t read the P/L, i.e. budget.
Plus he has other ppl to read the balance sheets.
I did a $20MM A round with $BIG_FIRM after associate asked for business plan and parter said “they sent it to us already” meaning just the Excel model. Which was a relief since I never write a BP suitable for public consumption, only internal use. But the excel model included all our assumptions for headcount, cap ex, op ex, regulatory and revenue so really what use was a narrative?
(It worked out for them)
Re: I have never read a business plan or balance sheet
#10I understand business plans, but balance sheets? It seems like you'd want to know the financial picture of a company. What else to you look at to, even at the most basic level, determine if the startup is going to be able to pay it's AWS bill and payroll that month?
Software businesses have one balance sheet item: cash.